EUR/JPY bounces off lows, back near 120.40 ahead of US NFP
- EUR/JPY dropped to lows near 120.00, rebounded afterwards.
- Safety inflows keep sustaining the demand for the yen.
- US Non-farm Payrolls coming up next.
The increasing buying pressure around the Japanese safe haven coupled with the unremitting offered bias in the European currency have forced EUR/JPY to recede further and print new 3-day lows near the 120.00 mark.
EUR/JPY stays focused on risk trends, looks to data
The cross is trading in the area of 3-day lows around 120.30 against the backdrop of the apparent investors’ preference for safer assets, motivating the Japanese yen to reverse part of the recent weakness.
On the other, hand the single currency is prolonging the bearishness sparked at the beginning of the week, particularly after the greenback regained traction on better-than-expected results from US fundamentals and positive news from the US-China trade front and the Wuhan coronavirus.
Earlier on Friday, German trade balance widened more than expected in December, while the Industrial Production contracted beyond consensus during the same period, showing that any recovery in the sector looks quite far away for the time being.
In the US docket, January’s Non-farm Payrolls will take centre stage later in the NA session. The economy is expected to have added 160K jobs during last month, the jobless rate is seen steady at 3.5% and Average Hourly Earnings – a proxy for wage inflation – is forecasted to return to the 3.0% YoY.
EUR/JPY relevant levels
At the moment the cross is retreating 0.35% at 120.37 and a drop below 120.12 (low Feb.7) would expose 119.77 (2020 low Jan.30) and finally 119.65 (low Nov.25 2019). On the other hand, the next up barrier is located at 121.15 (weekly high Feb.5) followed by 121.38 (monthly low Dec.13 2019) and then 122.87 (2020 high Jan.16).